County leaning toward referendum to fund school

Officials to vote on school-rooted issue Nov. 12

Published: Thursday, November 7, 2013 at 11:42 a.m.

Last Modified: Thursday, November 7, 2013 at 11:42 a.m.

More Davidson County officials appear to be leaning toward the most talked about plan to fund a proposed high school near Midway.

Commissioner Don Truell publicly supported the idea of holding a countywide referendum for a quarter-cent sales tax, the proceeds of which would help pay for the new school. Truell made his remarks Thursday during the board of commissioners' informational meeting at the county governmental center.

"It's about a no-brainer that we've got to do the sales tax," Truell said, adding that no one on the board wants the alternative: a property tax increase.

Truell is the fifth commissioner to openly embrace the sales tax concept, as commissioners Larry Potts, Fred McClure, Todd Yates and Billy Joe Kepley have all said they like the idea.

In addition, the board unanimously voted to consider a resolution at its next meeting, Nov. 12, which would call for a referendum during the May 2014 primary. Sam Watford, who has hinted that he also supports the referendum, was absent from the meeting for personal reasons.

After the meeting, commissioner Steve Jarvis said a referendum would be the only way he’d consider voting for any type of tax hike.

“It would have to go through a vote of the people, either a bond referendum or a quarter-cent sales tax,” Jarvis said. “I have a hard time with taxes being raised to begin with, but I realize the need and the overcrowding of the schools.”

The entire board approved an agreement with Davidson County Schools last month that will allocate about $5 million for preliminary work on the school project.

If approved and instituted, the sales tax is expected to generate about $2.3 million each year, which would be used to finance a large loan to pay for remainder of the project.

While some projections have the school's total price tag at $45 million, Davidson County Manager Robert Hyatt said school and county officials hope to stay within the $35-$40 million range. Factoring in the $5 million already approved through the school system agreement as well as initial proceeds from the proposed quarter-cent tax, the county may be looking at borrowing about $34 million, assistant county manager Zeb Hanner told commissioners.

The expected revenue from the sales tax would cover the debt service of a loan in the $34 million range, Hanner said.

The school, which would be built on county-owned property next to Oak Grove Middle School on Hoy Long Road, would seek to eliminate overcrowding issues at North Davidson and Ledford high schools. Commissioners committed to building the high school when the middle school opened in 2012, a pledge only strengthened by the recent agreement with the school system.

Now, the main question before commissioners is how the majority of the project will be funded, with the sales tax being the most discussed option.

After Yates asked what alternatives existed if the referendum failed, Hanner said the board would have to find revenue somewhere, most likely through a property tax increase. County budget projections show a 3 1/2 cent property tax increase if the school is built without other forms of revenue.

Ruth Huneycutt, director of the Davidson County Board of Elections, said the referendum would not incite many additional costs if placed on the May primary. However, the elections board has asked for 90 days' notice from commissioners to allow ample time to prepare for the special vote.

Since the General Assembly approved the local-option sales tax in 2007, the issue has gone to a referendum 90 times. Of those 90, 25 were approved and 65 failed, according to the North Carolina Association of County Commissioners.

Kepley reaffirmed his confidence that the Davidson County people would support the tax, which would typically cost consumers an additional 25 cents for every $100 they spend.

"If they know there is a need, especially with children, they will respond," Kepley said. "If the need is real and they are convinced of it, they will support it."

Kepley said needs of other schools will move up in priority with the construction of the high school, which is ranked No. 1 on Davidson County Schools' list of capital project needs.

"I really have faith in the Davidson County people," Kepley said. "I don't think they will let me down."

Nash Dunn can be reached at 249-3981, ext. 227, or at nash.dunn@the-dispatch.com. Follow Nash on Twitter: @LexDispatchNash

<p>More Davidson County officials appear to be leaning toward the most talked about plan to fund a proposed high school near Midway.</p><p>Commissioner Don Truell publicly supported the idea of holding a countywide referendum for a quarter-cent sales tax, the proceeds of which would help pay for the new school. Truell made his remarks Thursday during the board of commissioners' informational meeting at the county governmental center.</p><p>"It's about a no-brainer that we've got to do the sales tax," Truell said, adding that no one on the board wants the alternative: a property tax increase.</p><p>Truell is the fifth commissioner to openly embrace the sales tax concept, as commissioners Larry Potts, Fred McClure, Todd Yates and Billy Joe Kepley have all said they like the idea. </p><p>In addition, the board unanimously voted to consider a resolution at its next meeting, Nov. 12, which would call for a referendum during the May 2014 primary. Sam Watford, who has hinted that he also supports the referendum, was absent from the meeting for personal reasons.</p><p>After the meeting, commissioner Steve Jarvis said a referendum would be the only way he'd consider voting for any type of tax hike.</p><p>“It would have to go through a vote of the people, either a bond referendum or a quarter-cent sales tax,” Jarvis said. “I have a hard time with taxes being raised to begin with, but I realize the need and the overcrowding of the schools.”</p><p>The entire board approved an agreement with Davidson County Schools last month that will allocate about $5 million for preliminary work on the school project.</p><p>If approved and instituted, the sales tax is expected to generate about $2.3 million each year, which would be used to finance a large loan to pay for remainder of the project.</p><p>While some projections have the school's total price tag at $45 million, Davidson County Manager Robert Hyatt said school and county officials hope to stay within the $35-$40 million range. Factoring in the $5 million already approved through the school system agreement as well as initial proceeds from the proposed quarter-cent tax, the county may be looking at borrowing about $34 million, assistant county manager Zeb Hanner told commissioners.</p><p>The expected revenue from the sales tax would cover the debt service of a loan in the $34 million range, Hanner said.</p><p>The school, which would be built on county-owned property next to Oak Grove Middle School on Hoy Long Road, would seek to eliminate overcrowding issues at North Davidson and Ledford high schools. Commissioners committed to building the high school when the middle school opened in 2012, a pledge only strengthened by the recent agreement with the school system.</p><p>Now, the main question before commissioners is how the majority of the project will be funded, with the sales tax being the most discussed option. </p><p>After Yates asked what alternatives existed if the referendum failed, Hanner said the board would have to find revenue somewhere, most likely through a property tax increase. County budget projections show a 3 1/2 cent property tax increase if the school is built without other forms of revenue.</p><p>Ruth Huneycutt, director of the Davidson County Board of Elections, said the referendum would not incite many additional costs if placed on the May primary. However, the elections board has asked for 90 days' notice from commissioners to allow ample time to prepare for the special vote.</p><p>Since the General Assembly approved the local-option sales tax in 2007, the issue has gone to a referendum 90 times. Of those 90, 25 were approved and 65 failed, according to the North Carolina Association of County Commissioners.</p><p>Kepley reaffirmed his confidence that the Davidson County people would support the tax, which would typically cost consumers an additional 25 cents for every $100 they spend.</p><p>"If they know there is a need, especially with children, they will respond," Kepley said. "If the need is real and they are convinced of it, they will support it."</p><p>Kepley said needs of other schools will move up in priority with the construction of the high school, which is ranked No. 1 on Davidson County Schools' list of capital project needs.</p><p>"I really have faith in the Davidson County people," Kepley said. "I don't think they will let me down."</p><p>Nash Dunn can be reached at 249-3981, ext. 227, or at nash.dunn@the-dispatch.com. Follow Nash on Twitter: @LexDispatchNash</p>